What's New

Monetary policy is set to remain accommodative to ward off risks of deflation and lift inflation towards target. Macro-prudential policy is being reinforced to prevent the build-up of financial imbalances, not least an unsustainable increase in household debt, as interest rates stay low.

Bank Indonesia should remain cautious with regards to monetary and macro-prudential policies, taking into account both external and internal factors.Regulations on deposit interest rates have contributed to inefficient resource allocation and financial risks.